November 2008 Business Newsletter
STATE REGULATORS MAKE INSURERS KEEP THEIR RATES DOWN.
State regulators required auto insurers to reduce or withdraw their proposed 8% rate hike requests that would have cost consumers several hundred million dollars in increased premiums. State officials stated that auto insurance rates for New Yorkers will rise by an average of less than 1% for 2009.
State insurance regulators demanded that the companies justify their proposed increases in light of evidence that Americans were driving less, and therefore, posing less risk. "Because of higher gas prices, New Yorkers are driving less and having fewer accidents as a result," said New York Governor David Paterson in a press release. "It's simply counterintuitive to increase rates by 8% when people are driving less."
In June and July alone, New Yorkers drove 907 million fewer miles than in the same two months in 2007.
SOCIAL SECURITY BENEFITS TO RISE IN 2009.
Social Security benefits for 50,000,000 people will be going up 5.8% next year, the largest increase in more than a quarter of a century. This increase will begin in January and it will mean an additional $63 per month for the average retiree. The typical retiree's monthly check will go from $1,090 to $1,153.
The 5% rise in the cost of living adjustment is a sharp departure from recent years. The COLA increases have been below 3% for all but three of the past 15 years.
SIX SIGMA GAINS WIDER APPEAL.
Motorola Inc. may have pioneered Six Sigma, the business discipline that aims to solve problems and improve performance, but it is not just for manufacturers any more. Six Sigma is a system that allows employers to tackle issues they determine are costing too much money or hurting customer service or results. Data is the driving force, helping Six Sigma practitioners pinpoint the source of their problem as well as measure how well a solution is working. The goal is to formulate a cure that will generate consistent results and wipe out "defects."
John Lupienski, a Six Sigma consultant, said the system can work for a variety of employers, regardless of whether they make printed circuit boards, treat patients or serve customers in retail stores.
Leadership backing for Six Sigma is vital, but so is insuring employees understand what the goals are so that they will support it, Lupienski said. "You've got to make people realize that you won't have to worry about losing your job. The bottom line of Six Sigma is dollars and cents and customer satisfaction," he said.
2009 INFLATION ADJUSTMENTS WIDEN TAX BRACKETS.
For 2009, personal exemptions and standard deductions will rise and tax brackets will widen because of inflation adjustments announced by the IRS.
By law, the dollar amounts for a variety of tax provisions must be revised each year to keep pace with inflation. Key changes affecting 2009 returns, filed by most taxpayers in early 2010, include the following:
· The value of each personal and dependency exemption, available to most taxpayers, is up $150 to $3,650.
· The new standard deduction is $11,400 for married couples filing a joint return, which is up $500, and $5,700 for singles and married individuals filing separately, which is up $250. In addition, the standard deduction for heads of households is up $350 to $8,350.
· The annual gift exclusion rises to $13,000 up from $12,000 in 2008.
QUALIFYING FOR THE ALTERNATIVE MOTOR VEHICLE TAX CREDIT.
In the past, only Hybrid vehicles, fuel cell vehicles and alternative fuel vehicles had been certified as having qualified for the alternative motor vehicle tax credit. Now certain low fuel consumption vehicles that generally run on diesel fuel have been certified.
The qualifying vehicles and their credit amounts are:
· 2009 Volkswagen Jetta 2.OL TDI Sedan manual or automatic - $1,300
· 2009 Volkswagen Jetta 2.OL TDI Sport Wagon manual or automatic - $1,300
· Mercedes GL 320 BLU TEC - $1,800
· Mercedes R 320 BLU TEC - $1,550
· Mercedes ML 320 BLU TEC - $900
Prepared by Katy M. Hedges